Turkish immigration legislation: innovations and consequences

Real estate prices in Turkey: an increase to $200,000.

There is information circulating on social media about an increase in real estate prices in Turkey, where purchasing property can grant residency, to $200,000. This news became available after October 16, 2023, when reports indicated that a corresponding decree was adopted. Government authorities have not published the document, but immigration service employees confirm the increase in the threshold for obtaining residency permits. Realtors are already informing potential buyers about the new conditions.

Changes in immigration legislation in Turkey

The last few years have seen changes in immigration legislation in Turkey. Let us highlight three key dates:

• On April 26, 2022, a minimum property value threshold was established for obtaining a residence permit through TAPU (title deed): $75,000 for properties located in one of the 30 major cities of the country, and $50,000 for properties in the provinces.
• On July 1, 2022, a quota was introduced for issuing primary residence permits to foreigners, which should not exceed 20% of the population in a specific area. This led to the closure of 1,169 locations for processing new residence permits for any reason.
• On October 16, 2023, according to a temporary decree, the cost of housing for obtaining a residence permit must be $200,000 in all regions of the country.

Conditions for obtaining a residence permit in Turkey

When applying for a residence permit, the Migration Service takes into account various criteria, including the date of TAPU, the parties to the transaction, the status of the neighborhood and the assessed value. A residence permit cannot be issued on the basis of the purchase of several cheap apartments. The price of a property of $200 thousand is calculated at the exchange rate of the central bank on the date of obtaining TAPU. Due to the fluctuations of the lira, it is recommended to choose options for 10% more expensive than the established minimum. It is important to note that the minimum value of $200 thousand refers to a single object, not the entire real estate owned by a foreigner in Turkey.

New rules for obtaining residence permits in TurkeyThey started to take effect at the beginning of October, requiring indications of both cadastral and appraised values of real estate. The aim of the changes is to simplify the transaction process and make it safer. This particularly affects resort areas, where prices often vary.

On the southern coast, including Antalya, the cadastral value of real estate is often significantly lower than the market value by 30-70%, which complicates the process of obtaining residence permits and citizenship through real estate investment. Properties are now categorized for housing, citizenship, or vacation purposes.

The "citizenship by investment" program

The program has remained unchanged - to obtain Turkish citizenship it is necessary to invest at least 400 thousand dollars. However, there are speculations about a possible increase of this requirement to 750 thousand or even 1 million dollars. Foreigners are advised to act promptly to obtain citizenship.

Changes and rules for existing owners

Individuals who received TAPU before October 16 are not affected by the new rules. However, for those who purchased property before this date and have not yet obtained TAPU, new requirements come into effect. To obtain a residence permit, both the cadastral and appraised values must be indicated in the TAPU, with a minimum of 200,000 dollars.

It is very important for property owners to accurately indicate the owner in the TAPU. If the property belongs to several family members, only one of them can obtain a residence permit.

Interest in real estate in Turkey among Russians: trends and changes

In 2022, interest in Turkish real estate among Russians peaked, attracting around 1,500 to 2,500 people. However, in 2023, this figure has halved. Alexandra Kabakchi, the CEO of Ataberk Estate, notes that many who previously considered Turkey as a potential place for permanent residence are now questioning the feasibility of these plans.

Dynamics of requests and changes in purchasing goals

"We notice that about 10-15% of all real estate purchase requests were previously related to obtaining a residence permit. However, after 2022, this percentage has increased significantly despite the low numbers before that time," notes Kabakci. She says that transactions for resale or short-term stay under the visa-free regime continue to be relevant, while the number of purchases to obtain a residence permit is decreasing.

The impact of new regulations on the real estate market

“The latest changes in rental and residency permit regulations are already starting to have a negative impact on the real estate market, leading to a decrease in the number of transactions,” emphasizes Kabakchi. She also notes that the share of foreign buyers has dropped from about 4% to less than 3% by September 2023, and believes that the new rules will not significantly affect prices due to the small share of foreign investors seeking residency permits through the Tapu program, which is less than 0.5%.”

Factors influencing real estate prices in Turkey

Kabakchi adds: "The cost of real estate in Turkey is influenced by many factors, including earthquakes, rising construction costs, inflation, migration, and a shortage of land in popular areas."

Analysis of demand and the current situation in the market

Philippe Berezin, Editor-in-Chief, notes that demand for Turkish real estate among foreigners, including Russians, has declined since the beginning of 2022. He highlights several reasons for this decline, including natural disasters, political instability and rising prices. "Initially, price increases stimulated demand, but today's prices do not suit many potential buyers outside Turkey, especially given the new restrictions," he notes.

“Will prices decrease after the new regulations are introduced? This is a complex question. Firstly, the share of foreigners in the Turkish market is decreasing, and for most buyers, the new rules are not that significant. Secondly, inflation remains high, and property prices continue to rise even in euros and dollars,” explains Berezin.

“Finally, demand will depend on the ability to earn in Turkey as before. The new strict rules for short-term rentals have already come into effect, and if local agencies and developers do not adapt to them, it could cool the market even more than the increased requirements for obtaining residency permits,” he concludes.

In conclusion, I would like to note that the changes in Turkey's legislation regarding the cost of real estate for obtaining residence permits have serious implications for foreign buyers. The new threshold of $200,000 creates additional complications and requirements when planning to purchase property in the country. Realtors are already adapting to the new rules, and buyers are advised to be prepared for increased costs in real estate. These changes may also impact the real estate market in Turkey, reducing the number of available properties.